The 10-million jobs challenge

It is an eye-opener to look at the Pakistan Labour Force Survey’s data on unemployment rates by educational attainment. With more education is coming more unemployment. The rate of unemployment for individuals with less than one year of education, pre-primary or primary education range is between 2.9 to 4.7%. But for more qualified individuals, unemployment rates rise sharply: 5.1% for middle, 6.4 for matric, 11.7 for intermediate and 16.3 for degree holders. We are, in fact, educating our youth to make them more unemployable.

The fact of the matter is that more than college graduates, we need skilled workers. And the only way we can do that is through a robust technical and vocational education and training (TVET) system. No wonder that the PTI government promised to create 10 million jobs through TVET reforms.

Skilling such a large number of people requires immense funding and huge training delivery capacity. But besides training, there still are two important questions to be answered. Will the economy have enough jobs for these graduates? And will these graduates be suitably skilled for those jobs?

The answer to the first question is obvious. New jobs will come if the economy grows and fewer will be produced if economic growth slows. We need government policies that will generate economic growth and help lift all boats. But more importantly, we are not skilling our workforce appropriately for the jobs we already have — let alone those of the future.

A World Bank survey conducted in Punjab a few years ago reported that about 60% of firms said that the TVET system did not produce enough people with the skills required by employers while more than half the firms highlighted that “the TVET system did not produce enough people with up-to-date knowledge of methods, materials and technology”. Various other research and employer interviews seem to validate this.

This supply-demand disconnect is, in fact, a manifestation of poor quality and lack of relevance of TVET training programmes; outdated curricula, facilities and equipment; and limited funding.

And then the pressures of chasing unrealistic targets compound these issues. Politicians make the whole affair about quantitative targets, creating perverse incentives to churn out as many trainees as possible through short courses, without much regard for the quality.

No wonder that Pakistan scores lowest in South Asia on the human capital pillar of Global Competitive Index, while our unemployment rates are among the highest in the region.

If the government is serious about creating 10 million jobs, it needs to fix the TVET sector, which in turn needs a paradigm shift from a supply-driven to a demand-led sector. This means that TVET institutes should understand the private sector’s needs and then deliver accordingly rather than looking inwardly at resources they already have and producing whatever they can.

Understanding the nature of private sector demand is complex and requires extensive effort, but ironically even where there is a clear demand, the TVET sector often fails to respond to it.

Let’s take the example of Islamabad Airport, which had been under construction for years but there was no public sector TVET institute in the neighbouring districts that catered to the huge demand for construction skills or the follow-on demand for airport services. Similarly, CPEC brought in a number of mega projects without any corresponding change in our public sector TVET offerings. Even around the planned SEZs, TVET institutes are mostly clueless on how to prepare for upcoming opportunities.

The government must realise that the TVET sector cannot continue to work in isolation. This is a service for the private sector and, therefore, can be best performed in partnership with the private sector.

Published in The Express Tribune, November 19^th, 2019.

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